Sosinski Corporation has two divisions: Domestic Division and Foreign Division.The following data are for the most recent operating period: The common fixed expenses have been allocated to the divisions on the basis of sales. The Domestic Division's break-even sales is closest to:
A)$252, 632
B)$466, 116
C)$178, 947
D)$316, 737

Question

Sosinski Corporation has two divisions: Domestic Division and Foreign Division.The following data are for the most recent operating period:  The common fixed expenses have been allocated to the divisions on the basis of sales. The Domestic Division's break-even sales is closest to:
A)$252, 632 
B)$466, 116 
C)$178, 947 
D)$316, 737

Quizplus · Accepted Answer

Segment contribution margin = Segment sales - Segment variable expenses
= $300, 000 - $129, 000 = $171, 000
Segment CM ratio = Segment contribution margin ÷ Segment sales
= $171, 000 ÷ $300, 000 = 0.570
Dollar sales for a segment to break even = Traceable fixed expenses ÷ Segment CM ratio
= $102, 000 ÷ 0.570 = $178, 947

Sosinski Corporation Has Two Divisions: Domestic Division and Foreign Division